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Seagate
Brian Dexheimer: "New ideas..."

When it comes to thinking up new ways to meet the needs of his global customer base, Brian Dexheimer, the company’s executive vice president of sales and marketing, takes a decidedly different approach than many of his high-tech peers.

If his schedule permits, the long-time Seagate employee will indulge in a lunch-time soccer game before jumping back into the trenches to hash out ideas with Seagate customers and sometimes slug it out with competitors.

We caught up with Dexheimer to get his take on a number of wide-ranging company and industry issues. Here are excerpts.

Q: You’ve said recently that it’s critical for Seagate to have a smooth launch of its new products for the notebook and DVR markets. Why are those products in particular so important right now?

A: Those two products do two things for us. First, they allow us to enter a market in which we hadn’t participated previously. Second, a number of our competitors have been deriving a significant portion of their profitability from that stream without any competition from us. These new products are therefore very important because they provide us access to new customers and they put a lot more pressure on our competition while also helping fuel our growth.

Q: You’ve also identified enterprise storage as one of the core markets in which we must defend our leadership position.

A: Most people identify the enterprise market as being the classic Fibre Channel and SCSI high-performance drive category. If you look at the unit growth in that category over the last few years, it’s been rather modest. That being said, this last quarter we saw one of the highest TAMs (total available market) we’ve seen in the last four years. Within that space, there are some interesting transitions going on that create the need for more products, and that play to our strengths with our expanded enterprise product line.

The transition to 15K-RPM drives from 10K-RPM drives is important, for example, as well as the transition to small form factor enterprise products. And the growth of nearline storage products is another big trend in the enterprise space. Not everything requires enterprise-class performance and connectivity. Nearline storage is designed for capacity, rather than performance. It’s ideal for customers who need to store financial records or e-mail archives, for instance. Our NL35 Series targets this portion of the enterprise market.

The enterprise market doesn’t get the headlines that other segments like MP3 players get. If you look at the revenue opportunities for MP3 players today, and at least for the next few years, that market is really dwarfed by the enterprise. The enterprise remains a big business driver for us.

Q: Aside from identifying new market opportunities like MP3 players and nearline storage, what else is the company doing to meet its objectives?

A: We’re in a very competitive industry and I think a little healthy paranoia is a good thing. We’ve done a good job challenging our processes to make them better, and we can’t stop that push for continuous improvement in meeting our customers’ needs. Going forward, we’ll probably have to look outside this industry for other benchmarks to help us deliver best-in-class performance, whether it’s on the manufacturing or product-design side of the business.

We have a lot of opportunity with these new markets. The growth of these new markets and delivering our new products is really our first priority.

Q: Recently, the CEO of one of our key competitors publicly criticized Seagate’s five-year warranty program, saying it was bad for the industry. What’s your response?

A: Bad for the industry? It’s certainly good for consumers. How can you argue with the message behind it? We believe we’ve got a more reliable product than our competition and we’re willing to back it up with the best warranty in the business. It’s absolutely a great thing for our customers.

We launched this warranty program because we knew it was something customers would value and because it would be a real competitive weapon for us.


 

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